Slide 1

HRMS System: Convergence

2002 - 2004 HRMS System Convergence

Convergence from SAP to PeopleSoft

Updated July 24, 2002

Illegible Stamp

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Slide 2

Cost Summary - July 2002

• HRMS conversion can take place independent of financial systems.
• Project focus is data conversion, PeopleSoft business processes will be adopted whenever possible, and [REDACTED TEXT].
• Assumes 2002 project initiation to leverage VIS convergence experience and work effort required to support [REDACTED TEXT].

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Slide 3

Annual Savings - July 2002

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Slide 4

Funding Strategy

REDACTED

• Charge the following project costs [REDACTED TEXT] in 2002:
  • Production hardware = [REDACTED TEXT]
  • Test hardware = [REDACTED TEXT]
  • Begin implementation of retroactive pay and gross pay software change = [REDACTED TEXT]
  • Begin work on data conversion and system availability = [REDACTED TEXT]
  • Total charged [REDACTED TEXT] in 2002 = [REDACTED TEXT]
• Remaining IT software development costs to be incurred in 2003 and 2004:
  • [REDACTED TEXT] workdays @ [REDACTED TEXT]/day = [REDACTED TEXT]
  • PeopleSoft license fee adjustment = [REDACTED TEXT]
  • Total 2003 and 2004 D&E funding requirement = [REDACTED TEXT]
• Potential conversion strategy:
  • 2 phases = 1st phase to include approximately 15,000 employees
• Cut phase 1 in October 2003, phase 2 April 2004

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Slide 5

Business Drivers for Convergence

REDACTED

• 70% of Verizon employees currently supported by PeopleSoft.
• Supports all four Human Resources key business priorities, [REDACTED TEXT].
• Enables the implementation of standard business processes (e.g. personnel administration, payroll office support, compensation administration, recruitment), and reduces business operating costs.
• Facilitates the administration of Benefits Plans by having interfaces from only one system to our key third party administrators [REDACTED TEXT].
• Eliminates an entire application platform, which significantly reduces system support costs: COPS labor; hardware support; software maintenance fees.
• Reduces ongoing system maintenance by eliminating the need for applying mandatory D&E updates to two systems. Eliminates the need for future system upgrades to the SAP HR/Payroll system.
• Facilitates the introduction of new companies and the transfer of employees between companies.
• Simplifies organizational reporting.
• Eliminates current LOB independent plans and workarounds to consolidate HR and payroll administrations.

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Slide 6

Requested Supporting Documentation:

• Appendix A - Status of Transition Funding by Business Segment.
• Appendix B - Transition Business Cases - Not Approved.
• Appendix C - eHR Initiatives Enabled by Convergence.
• Appendix D - Summary of Human Resource Force Reductions.

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Slide 7

Appendix A

Verizon Transition Costs Summary
($ Millions)

• Includes [REDACTED TEXT] for funding HRMS convergence project in 2002

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Slide 8

Appendix B

Transition Business Cases - Not Approved

(1) Retail has been asked to provide a limited version of the Marketing Date Warehouse project. The not approved portion is designated as (NA).
(2) A portion of [REDACTED TEXT] of the Barcode project was approved. This portion is designated as Not Approved (NA).
(3) Currently under review with intent to cover within target (Gap has been closed).
(4) Currently under review.

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Slide 9

Appendix C

eHR Initiatives Enabled by Convergence

• Integrated Workflow - Reduction of paper processing; faster transaction cycle times
• Employee Services & Payroll Services - Standardized Administrative Support
• Organizational Hierarchy and Reporting
• Integrated HRMS Data Mart/Warehouse Strategy
• Role Based Security -Enhances/simplifies data security and associated administration
• Interactions and Transactions with Benefits Vendors (primarily Hewitt and Fidelity)
• Absence Management Tracking System
• Staffing Systems (Associate, Management, Executive, Leadership Development)
• Compensation Systems (Associate, Management, Executive)
• Workforce Development Systems (Performance Management)
• Labor Relations Database (bargaining planning, contracts, grievance tracking, etc.)
• Worker's Compensation System
• Accident Reporting System
• Diversity Tracking and Reporting
• Migration to Common Processes (time & attendance, gross/net payroll calculations, etc.)
• Facilitate/Simplify the Movement of Employees across Verizon entities
  
  

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Slide 10

Appendix D

Human Resource
Summary of Force Reduction

Human Resource Force Savings are as follows:

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